Monthly Bulletin

<%@LANGUAGE="VBSCRIPT" CODEPAGE="1252"%> Monthly Bulletin

SO2 EA and NOx EA
April 2004

April 2004 SO2 EA and NOx EA MPI HEADLINES
SO2 EA MPI Up 2.28% - Vintage 2004 NOx EA MPI Down 3.54%

What are the Cantor Environmental Brokerage SO2 EA and NOx EA MPIs?

The Cantor Environmental Brokerage Market Price Indices (MPIs) are prices that reflect current market conditions for Clean Air Act Title IV SO2, and Section 126/NOx SIP Call emission allowances (EAs). The MPI is an average of the following three numbers (where available) (Note: fees and commissions are not.

RECENT TRANSACTION PRICE
Prices from the most recent transactions (sales, swaps, and options) either executed by Cantor Environmental Brokerage and/or reasonably believed by Cantor Environmental Brokerage to have occurred. Also note that the MPI does not include transactions that are reported as retirements or facility changes of ownership because such transactions may not be reflective of current market conditions.

Lowest Offer Price
Lowest price, reported to Cantor Environmental Brokerage, at which a seller is willing to sell.

Highest Bid Price
Highest price, reported to Cantor Environmental Brokerage, at which a buyer is willing to buy.

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For More Information Call (203) 662-3638
19 Old Kings Highway South, Darien, Connecticut 06820
Fax (203) 662-3643

www.emissionstrading.com

Note: All information contained here is obtained by Cantor Environmental Brokerage from sources believed to be accurate and reliable. However, because of the possibility of human and mechanical errors, as well as other factors, such information is provided "as is" without warranty of any kind and Cantor Environmental Brokerage, in particular, makes no representation or warranty as to the accuracy, timeliness, or completeness of this information. Under no circumstance shall Cantor Environmental Brokerage have any liability to any person or entity for (a) any loss or damage in whole or in part caused by, resulting from, or relating to any error (negligent or otherwise) or other circumstance involved in procuring, collecting, compiling interpreting, analyzing, editing, transcribing, transmitting, communicating, or delivering any such information, or (b) any direct, indirect, special, consequential, or incidental damages whatsoever even if Cantor Environmental Brokerage is advised in advance of the possibility of such damages, resulting from the use of, or inability to use, any such information. The data and information contained herein are, and must be construed solely as statements of opinions and not statements of fact or recommendations to purchase, sell, or hold SO2 or NOx EAs. All prices are merely indications of interest, do not represent firm bids and offers, and their terms are subject to change without notice. NOWARRANTY, EXPRESS OR IMPLIED, AS TO THE ACCURACY, TIMELINESS, COMPLETENESS, MERCHANTABILITY, OR FITNESS FOR ANY PARTICULAR PURPOSE OF ANY SUCH DATA OR INFORMATION OROTHER OPINION IS GIVEN OR MADE BY CANTOR ENVIRONMENTAL BROKERAGE IN ANY FORM OR MANNER.

For information on trading SCAQMD RTCs and/or ERCs, SJVAPCD and BAAQMD ERCs, Illinois ATUs, ERCs, DERs, or Sewerage Facilities Charge Credits please visit or call 1-800-228-2955 ext. 1, 2, 4, 6, 7, 8, or 9. For information on trading HGA NOx Allowances, call 800-228-2955 ext. 13 or 14. For information on trading NOx Section 126/NOx SIP Call Allowances, and SO2 Allowances call (203) 662-3638 or 800-228-2955 ext. 6 or 12. For information regarding Greenhouse Gas Credits visit , or call 800-228-2955 ext. 10.

            April 2004
           CANTOR ENVIRONMENTAL BROKERAGE
           SO2 EA Market Price Index

Cantor Environmental BROKERAGE Market Price Index: $281.02
(Call 203-662-3638 for description)

	Bids*	Offers*	Trades	MPI
Price/Volume	2,500 @ $281.00	2,500 @ $284.00	Not Listed
Weighted Average	$281.00	$284.00	$277.8788	$281.02

Immediate Settlement

		Best Prices ($/Allowance)		Maximum Volume
Term	Vintage	Bid to Buy	Offer to Sell	Bid	Offered
1 Year Term	2004	$281.00	$284.00	2,500	2,500	Allowances
	2005	$279.88		2,500		Allowances
	2006	$279.18		2,500		Allowances
	2007	$274.82		2,500		Allowances
	2008	$265.72		2,500		Allowances

Swaps


Swap Rates against vintage 2003 allowances
	2004	2005	2006	2007
Offer	0.40%	0.65%	2.25%	5.75%
Ratios for base years other than 2003 are available upon request.

SO2 EA Market Beat

  The Cantor Environmental Brokerage SO2 EA
  Market Price Index increased by 2.28% this
  month from $274.76 in March 2004
to $281.02 in April 2004.

            April 2004
           CANTOR ENVIRONMENTAL BROKERAGE
           NOx EA Market Price Index

BEST BIDS TO BUY			BEST OFFERS
2004	50 tons	$1,900/ton	2004	50 tons	$2,000/ton
2005	50 tons	$2,700/ton	2005	50 tons	$2,900/ton
2006	50 tons	$2,750/ton	2006	50 tons	$2,900/ton
2007	50 tons	$2,500/ton	2007	50 tons	$3,000/ton

RECENT TRADE PRICES March 26, 2004 - April 26, 2004
	V06 for $2,750/ton	V04 for $1,850/ton	V04 for $2,000/ton x2
	V05 for $2,950/ton x2	V04 for $1,950/ton x2	V06 for $3,000/ton
	V05 for $2,950/ton x2	V04 for $1,975/ton	V05 for $2,950/ton
	V05 for $2,950/ton x2	V04 for $2,000/ton x3	V07 for $2,700/ton
	V06 for $2,725/ton x2	V07 for $2,700/ton	V03 for $1,900/ton
	V04 for $1,950/ton	V05 for $2,900/ton x3	V06 for $2,950/ton
	V04 for $1,925/ton	V04 for $2,062.50/ton	V05 for $2,850/ton
	V05 for $2,850/ton	V04 for $2,075/ton	V05 for $2,800/ton
	V06 for $2,750/ton x2	V04 for $2,100/ton x2	V04 for $1,975/ton
	V06 for $2,750/ton x2	V04-06 for $2,550/tpy	V04 for $2,000/ton
	V05/04 for $900/ton	V06 for $3,000/ton x3	V04 for $2,000/ton
	V04 for $1,850/ton	V04 for $2,100/ton	V05-07 for $2,800/ton
	V04 for $1,800/ton x2	V06 for $3,000/ton	V05 for $2,850/ton

MARKET INDEX PRICE
	2004 $1,964/ton	$72
	2005 $2,833/ton	$232
	2006 $2,848/ton	$90

            April 2004
           CANTOR ENVIRONMENTAL BROKERAGE
           Market News

New Non-Attainment Areas announced for revised Ozone and PM2.5 NAAQS		Announced April 15, 2004, the revised ozone and new PM2.5 NAAQS placed many areas of the country in ‘nonattainment’. However, the status does not necessarily reflect worsened air quality. Rather, EPA desires that air quality be further improved. As a result of the revised NAAQS, demand for emission offsets should increase, and it is reasonable to anticipate the CAIR will be an active part of many states’ SIPs as they look to achieve attainment with the revised NAAQS.
As part of its responsibilities under the Clean Air Act, EPA implements National Ambient Air Quality Standards (NAAQS) for certain pollutants, including ozone and particulate matter. Areas that do not meet the NAAQS are known as non-attainment areas. Air quality officials in non-attainment areas are required to write state implementation plans (SIPs) defining the methodology by which the state intends to attain the relevant NAAQS. SIPs include items such as emission control; emission offsets; and emission allowance requirements.

Model NOx and SO2 Cap and Trade Rule to be Proposed in 3-4 Weeks

EPA announced at a recent meeting attended by Cantor staff, that the proposed Interstate Air Quality Rule (“IAQR”) will now be known as the Clean Air Interstate Rule ("CAIR"). CAIR is intended to further reduce emissions of NOx and SO2 by electric generating units (EGUs) using cap and trade programs. In addition, EPA is close to issuing a model trading rule for states to use in revising their SIPs in response to CAIR. Recognizing that current trading programs include non- EGUs, our staff asked EPA representatives how the new program will integrate with these non-CAIR sources. While unable to discuss a draft regulation, EPA representatives mentioned that they are aware of the issue and have addressed it in the proposed model rule. We will remain in touch with EPA in order to report any developments associated with the new rule.

For more information please call us at 800-228-2955.

Cantor Environmental Brokerage
19 Old Kings Highway South, Darien, Connecticut 06820
Tel. (203) 662-3638 Fax (203) 662-3643
www.emissiontrading.com

SO2 and NOx Trading Sideways

EPA is in the process of “truing-up” emissions data, and as a result compliance accounts for both NOx and SO2 are frozen at this point. Nevertheless, spot (2004) or later vintage EAs can still be traded and transferred. Price support in the $275-285 range in SO2 and $1900-2100 range in NOx, and the wait for determining summer heat (or lack thereof), have resulted in the markets remaining alm and trading sideways this month. NOx has fallen 3.54% since last month, while SO2 has risen 2.28%. As of today’s close, however, the SO2 upper limit of $286 is once again being tested, with a last trade of $284. Recent reports suggesting that $300/ton for SO2 is achievable considering control costs may have spurred this latest round of buying interest.

To Reach Cantor Environmental Brokerage Staff Call 800-228-2955 or Dial Direct:
Josh Margolis San Francisco RTCs/ERCs/DERs 800-228-2955 ext 1	Robin Langdon San Francisco RTCs/ERCs/DERs 800-228-2955 ext 2
Andy Kruger Darien, CT ERCs/NOx & SO2 EAs/DERs 800-228-2955 ext 6	Alexa Paton Darien, CT ERCs/NOx & SO2 EAs/DERs 800-228-2955 ext 6
Laurie Gage New York ERCs/NOx & SO2 EAs/DERs 800-228-2955 ext 7	Lauren Kisling New York ERCs/NOx & SO2 EAs/DERs 800-228-2955 ext 7
Mike Hammond San Francisco RTCs/ERCs/DERs 800-228-2955 ext 9	Christine Grandstaff Los Angeles RTCs/ERCs/DERs 800-228-2955 ext 4
Diarmuid McGarry San Francisco Back Office Manager 800-228-2955 ext 3